Moscow’s prime residential market recorded the weakest performance, with prices declining by 8.0% in the year to Q1 2011; however, the rate of decline is slowing, with -0.7% recorded in the last quarter.

Liam Bailey, Knight Frank’s head of research, said:

Our view is that the next property cycle – which has already started – will see the consolidation of an elite tier of global city markets, where the top addresses will become increasingly fought over by wealthy buyers as stores of value and long-term secure investments.

Values will rise from here. It won’t be a steady upward path, and there are some considerable risks out there – from sovereign debt in the West to asset bubbles and hot money in the East. But in the last two years the highest price achieved in the global market has breached the £6,000/sq ft barrier.

The £10,000/sq ft barrier will be breached at some point this decade. My view is that it won’t happen in Asia – the first market to break this barrier will be London.

Hmmm … so aside from the pesky sovereign debt debacle, asset bubbles and hot money in the East (whatever that means) all is well with the world…